The British Columbia Real Estate Association (BCREA) Commercial Leading Indicator (CLI) bounced back in the first quarter of 2013, rising 0.4 points and partially offsetting the decline in the fourth quarter of 2012. The index is currently sitting at 112.2. On a year-over-year basis, the CLI is 0.2 per cent above the first quarter of 2012.
The increase in the index was the result of stronger economic activity, particularly in the manufacturing sector due to a large increase in wood products output. Momentum in Canadian real estate investment trusts (REIT) returns and narrower risk spreads translated to a positive contribution in the index’s financial component. The employment component of the index, however, continues to lag due to a sharp slowdown in manufacturing employment.
"The increase in the CLI following last quarter’s decline has meant an overall flattening in the index’s underlying trend,” said Brendon Ogmundson, BCREA Economist. “This indicates that the slowdown signaled previously for the first half of this year will likely give way to modest growth in the second half of 2013."
Copyright BCREA -reprinted with permission
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